A non-fungible token, or NFT, is a digital asset that can not be replicated, in contrast to coins which are “fungible” or identical with an identical value, that serve as a commodity. Anything that is unique and digital – such as at, music, a picture of this article, or even your name – can be created and sold as an NFT.
So, think of it this way, there can be millions of identical coins, but only one NFT. Each is cryptographically created on blockchain with it’s own unique identification code and metadata.
The process of creating an NFT is called minting. First choose the marketplace, and make sure you have a compatible wallet. A good place to start is with a MetaMask wallet and OpenSea marketplace, they will ask you to upload a JPEG or other compatible file and follow the prompts.
NFT’s can represent or be combined with physical items, including art, real estate deeds, and sculptor. There are all kinds of use cases. NFT’s can also represent people’s unique identities, be used for VIP passes, or turn collectibles into digital assets for a global market and the rights exchanged instantly without a store, gallery or dealer.
Brands are also using NFT’s to advertise. Budweiser has created a unique collection of beer NFT’s, in which the purchasers receive a physical case of a uniquely branded beer. Sports teams are turning their key players and iconic photographic moments into digital football and baseball cards. Digital real estate within a game can be purchased or earned in a “play to earn” model. Musicians can now allow their fans to purchase NFT’s of their work on AUDIUS, cutting out the middle man, such as Spotify, who can take up to 80% of revenues.
There are some big success stories out there. The NBA Top Shot, for example, allows people to collect non-fungible tokenized NBA moments in a digital card form, that have sold for millions of dollars. Twitter CEO, Jack Dorsey, sold a tokenized version of the first tweet ever written for $2.5 million. A New York Times tech columnist sold an NFT of his column at auction for $600,000, and no one was more surprised than him. But don’t expect your NFT collection to take off on its own, a rule of thumb is that a combination of scarcity, the size of your platform, and buzz all adding value. NFT’s design for utility gain their value from what they represent.
NFT’s add liquidity because they are also interoperable – actually easier to exchange for one another, than currencies which can only swap on certain networks. NFTs evolved from the ERC-721 standard, showing ownership details, security, and metadata.
Finally, NFT’s can be collaborative and spawn additional layers. Here’s a pregnant description of the use case CryptoKitties from investopedia: Launched in November 2017, cryptokitties are digital representations of cats with unique identifications on Ethereum’s blockchain. Each kitty is unique and has a price in ether. They reproduce among themselves and produce new offspring, which have different attributes and valuations as compared to their parents. Within a few short weeks of being launched, cryptokitties racked up a fan base that spent $20 million worth of ether purchasing, feeding, and nurturing them. Some enthusiasts even spent upwards of $100,000 on the effort.
As companies prep for the Metaverse – whatever that eventually turns out to be – NFT’s provide a way to move retail into new virtual worlds. Adida is already selling virtual shoes for your virtual identity. As with Budweiser, crossing back into the physical universe is not especially hard, maybe you’ll get a QR code for a free physical set of shoes, too.
Fine art versus graphic art
Interestingly, the NFT world blurs the line between the formerly primarily commercial realm of graphic artists and illustrators using Photoshop, and the fine artists who must now find a way to digitize their art, including sculptor, murals, water-colors. You can simply scan or photograph your work of art, then touch it up with photoshop, or hire a graphic designer to do it for you.
NFT’s also blur the line between “true art” – if their is such a thing – which is often sold one at a time, and collectibles. Many collections are appealing for the sake of scarcity, status and the satisfaction of collecting itself, rather than artistic merit. Someone who buys a $3 million Bored Chimp and uses it for their social media Avatar gains status, and a “cool” factor.
Some artists have started drawing on the iPad to replicate the experience, of, say, Plein Aire. There is a great exploration of the cross-over between art and graphic art in a Washington Post article here., must reading for anyone who truly wants to understand how NFT’s are influencing art markets.
Start with a concept
Spending time developing concept will inform how you market as well as the platform. The two main areas for NFT’s are general art (including music and sports collectibles) and utility (ticketing, real estate deeds, and so on).
*What business are you in? How can NFT’s support this business? Your logo is a natural place to start. Those in the newspaper world, may want an NFT collection from their historic photographs. One member who works for a yogurt store is planning to offer x amount of free yogurt to people who purchased their NFT, so those can be bought and sold. If you are in the events business, NFT holders can get special access.
* Do you have a passion or hobby? A collection based around your interest may attract like-minded people, or even a commercial buyer. Maybe the world doesn’t need another 25 tennis playing cats – or maybe you’ll perk the interest of a brand. Animated characters are in demand by industries such as sports clothing, but also remember that think food, other kinds of clothing, and travel may have commercial tie-ins.Assess your contacts – It’s always great to have a buyer before your build!
* What other communities are you connected with? If you already are posting art or music in social media, that’s a great following to start with.
Collections
As noted, collections have an interesting value. Do you already make a series of robots, or fish ornaments for the holidays? Photographs of an area or topic? You may already have a head start on your NFT collection. If you have a great idea but don’t now photoshop, don’t be afraid to hire a graphic artist to help out.
People who find your work valuable are your best resource, and if you already have a community or a well-known brand you are light years ahead. This does not mean nationally famous, it could be just locally well-known, or followed by your own collectors.
Conceptual
Sometimes NFT’s get attention just by being “first in the world” at something. Is it “remarkable” ie shareable on social media or ready for the news? What a portraits of every U.S. congressional representative, all the presidents, 100 prisoners, drawn you your iPad. Maybe you NFT of a dog comes with the real dog, and gets picked up by the local television station.
All these factors will influence both your concept and how you market it to the world.
Platforms
The concept you create will inform your choice of platforms. In general, the more exclusive the platform, the easier it is to reach investors without needing to develop your own following and social community. Propy is currently the leading platform for real estate, Audius seems to have the best foothold for music, but art has a variety of options.
Theoretically, a well-known artist can skip the gallery and social media if they can get on one of these exclusive platforms. Here’s a run down of visual art platforms available, courtesy of Creative Bloq:
1. OpenSea
The largest, oldest and best known NFT marketplace, with every kind of NFT under the sun: Gaming, art, music, photography and collectibles. Creative Bloq wisely calls it the “Amazon” of marketplaces, gas free. Set up a free account. A great place to begin.
2. Nifty Gateway
Huge, jaw-dropping sales happen here, including Beeple’s sale of CROSSROAD, and PAK’s, $91.9 million sale of The Merge.
Investors can use dollar, not just crypto to buy, and time limits, so unlimited editions can be timed out.
3. Rarible
Single piece of art and other rarities such as sports and art collections are sold here. Users need to use RARIs and other tokens, and are part of a DAO that goes on platforms changes.
4. Binance NFT
Bnance is a huge crypto exchange so its entry into NFT’s did not go un-noticed. Investors use ETH, BNB, BNB and BUSD to. Bid.
5. SuperRare
ArtBloq calls this an “art-first” marketplace with a “gallery attitude” that only accepts “1% of all artist which sounds snobbish but also means you get a catalogue of highly curated and interesting” work. No editions allowed. This is for the SuperRare art and serious artists.
6. Async Art
There is no way to explain this easily without just quoting: Async Art is an NFT marketplace known for ‘programmable art’. Each work of art is made up of a Master and Layers; Masters are the entire NFT while Layers are separate elements that make up the art, and can be altered. Everything is ‘Tokenized’ meaning different artists can own different layers, and contribute to changing the artwork.
Hmm. Generative on-going project like Bored Apes welcome. Is this for you?
7. MakersPlace
For well-known artists that are feature in Christi’s, Sotheby’s or other find artists. Work must be digitally signe and recorded in blockchain.
8. KnownOrigin
Artists here are also vetted and typically famous. They can airdrop a number of copies to add scarcity. Investors must use Ethereum and collaborations are not supported.
9. Foundation
This is an artist-run platform, in which you must receive an invite from a current artist to join. Artist earth 85% of first sale and 10$ of secondary sales, but artists are considered authentic and reputation is respected by other artists adn galleries.
10. Zora
Good space to music NFT’s, with physical objects sold to super fans.
11.Mintable
This is another super easy to use platform, Creativebloq compares to Etsy, and back by billionaire Mark Cuban. No crypto knowledge required to set up your store and mint.